XML 35 R24.htm IDEA: XBRL DOCUMENT v3.20.2
Segment Information
 9 Months Ended
Sep. 30, 2020
Segment Reporting [Abstract]  
Segment Information Segment Information
Reporting Segments

Operating segments are defined as components of an enterprise for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision maker ("CODM") in deciding how to allocate resources and assess performance. We are comprised of three reportable segments: Tubular Running Services (“TRS”) segment, Tubulars segment and Cementing Equipment (“CE”) segment.

The TRS segment provides tubular running services globally. Internationally, the TRS segment operates in the majority of the offshore oil and gas markets and also in several onshore regions with operations in approximately 50 countries on six continents. In the U.S., the TRS segment provides services in the active onshore oil and gas drilling regions, including the Permian Basin, Eagle Ford Shale, Haynesville Shale, Marcellus Shale and Utica Shale, and in the U.S. Gulf of Mexico. Our customers are primarily large exploration and production companies, including international oil and gas companies, national oil and gas companies, major independents and other oilfield service companies.

The Tubulars segment designs, manufactures and distributes connectors and casing attachments for large outside diameter (“OD”) heavy wall pipe. Additionally, the Tubulars segment sells large OD pipe originally manufactured by various pipe mills, as plain end or fully fabricated with proprietary welded or thread-direct connector solutions and provides specialized fabrication and welding services in support of offshore deepwater projects, including drilling and production risers, flowlines and pipeline end terminations, as well as long-length tubular assemblies up to 400 feet in length. The Tubulars segment also specializes in the development, manufacture and supply of proprietary drilling tool solutions that focus on improving drilling productivity through eliminating or mitigating traditional drilling operational risks.

The CE segment provides specialty equipment to enhance the safety and efficiency of rig operations. It provides specialized equipment, services and products utilized in the construction of the wellbore in both onshore
and offshore environments. The product portfolio includes casing accessories that serve to improve the installation of casing, centralization and wellbore zonal isolation, as well as enhance cementing operations through advance wiper plug and float equipment technology. The CE segment also provides services and products utilized in the construction, completion or abandonment of the wellbore. These solutions are primarily used to isolate portions of the wellbore through the setting of barriers downhole to allow for rig evacuation in case of inclement weather, maintenance work on other rig equipment, squeeze cementing, pressure testing within the wellbore and temporary and permanent abandonments. These offerings improve operational efficiencies and limit non-productive time if unscheduled events are encountered at the wellsite.

Revenue

We disaggregate our revenue from contracts with customers by geography for each of our segments, as we believe this best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. Intersegment revenue is immaterial.

The following tables presents our revenue disaggregated by geography, based on the location where our services were provided and products sold (in thousands):
Three Months Ended September 30, 2020
Tubular Running ServicesTubularsCementing EquipmentConsolidated
United States$15,213 $12,483 $7,430 $35,126 
International37,713 4,000 7,578 49,291 
Total Revenue$52,926 $16,483 $15,008 $84,417 
Three Months Ended September 30, 2019
Tubular Running ServicesTubularsCementing EquipmentConsolidated
United States$34,903 $10,148 $20,044 $65,095 
International67,374 2,371 5,577 75,322 
Total Revenue$102,277 $12,519 $25,621 $140,417 
Nine Months Ended September 30, 2020
Tubular Running ServicesTubularsCementing EquipmentConsolidated
United States$64,256 $27,270 $28,245 $119,771 
International140,494 10,496 23,249 174,239 
Total Revenue$204,750 $37,766 $51,494 $294,010 
Nine Months Ended September 30, 2019
Tubular Running ServicesTubularsCementing EquipmentConsolidated
United States$114,466 $45,163 $62,963 $222,592 
International192,505 8,347 17,035 217,887 
Total Revenue$306,971 $53,510 $79,998 $440,479 
    Revenue by geographic area were as follows (in thousands):
Three Months EndedNine Months Ended
September 30,September 30,
2020201920202019
United States$35,126 $65,095 $119,771 $222,592 
Europe/Middle East/Africa20,082 41,071 77,402 116,126 
Latin America20,001 19,181 61,003 56,520 
Asia Pacific6,928 9,727 25,231 27,753 
Other countries2,280 5,343 10,603 17,488 
Total Revenue$84,417 $140,417 $294,010 $440,479 

Adjusted EBITDA

    We define Adjusted EBITDA as net income (loss) before interest income, net, depreciation and amortization, income tax benefit or expense, asset impairments, gain or loss on disposal of assets, foreign currency gain or loss, equity-based compensation, unrealized and realized gain or loss, net severance and other charges, other non-cash adjustments and other charges. We review Adjusted EBITDA on both a consolidated basis and on a segment basis. We use Adjusted EBITDA to assess our financial performance because it allows us to compare our operating performance on a consistent basis across periods by removing the effects of our capital structure (such as varying levels of interest expense), asset base (such as depreciation and amortization), income tax, foreign currency exchange rates and other charges and credits. Adjusted EBITDA has limitations as an analytical tool and should not be considered as an alternative to net income (loss), operating income (loss), cash flow from operating activities or any other measure of financial performance presented in accordance with GAAP.

    Our CODM uses Adjusted EBITDA as the primary measure of segment reporting performance.
    The following table presents a reconciliation of Segment Adjusted EBITDA to net loss (in thousands):
Three Months EndedNine Months Ended
September 30,September 30,
2020201920202019
Segment Adjusted EBITDA:
Tubular Running Services$982 $23,884 $18,336 $67,019 
Tubulars1,806 456 3,883 8,502 
Cementing Equipment3,376 3,031 6,806 9,854 
Corporate (1)
(7,151)(11,350)(24,645)(42,533)
(987)16,021 4,380 42,842 
Goodwill impairment
— — (57,146)— 
Severance and other charges, net
(3,549)(5,222)(29,436)(6,492)
Interest income (expense), net(93)563 618 1,757 
Depreciation and amortization
(15,950)(21,482)(52,920)(70,637)
Income tax (expense) benefit(6,395)(7,297)182 (20,370)
Gain (loss) on disposal of assets308 (603)898 (984)
Foreign currency gain (loss)2,334 (3,872)(5,865)(4,050)
TRA related adjustments— — — 220 
Charges and credits (2)
(3,459)(1,897)(8,725)(9,522)
Net loss$(27,791)$(23,789)$(148,014)$(67,236)
(1)    Includes certain expenses not attributable to a particular segment, such as costs related to support functions and corporate executives.
(2)    Comprised of Equity-based compensation expense (for the three months ended September 30, 2020 and 2019: $2,773 and $2,647, respectively, and for the nine months ended September 30, 2020 and 2019: $8,434 and $8,238, respectively), Unrealized and realized gains (losses) (for the three months ended September 30, 2020 and 2019: $(113) and $1,382, respectively, and for the nine months ended September 30, 2020 and 2019: $1,480 and $2,073, respectively) and Investigation-related matters (for the three months ended September 30, 2020 and 2019: $573 and $632, respectively, and for the nine months ended September 30, 2020 and 2019: $1,771 and $3,357, respectively).
    The following tables set forth certain financial information with respect to our reportable segments (in thousands):
Tubular Running ServicesTubularsCementing EquipmentCorporateTotal
Three Months Ended September 30, 2020
Revenue from external customers
$52,926 $16,483 $15,008 $— $84,417 
Operating income (loss)(13,717)860 1,160 (12,049)(23,746)
Adjusted EBITDA982 1,806 3,376 (7,151)*
Three Months Ended September 30, 2019
Revenue from external customers
$102,277 $12,519 $25,621 $— $140,417 
Operating income (loss)8,253 (377)(1,610)(21,069)(14,803)
Adjusted EBITDA23,884 456 3,031 (11,350)*
Nine Months Ended September 30, 2020
Revenue from external customers
$204,750 $37,766 $51,494 $— $294,010 
Operating income (loss)(28,284)1,327 (78,824)(39,459)(145,240)
Adjusted EBITDA18,336 3,883 6,806 (24,645)*
Nine Months Ended September 30, 2019
Revenue from external customers
$306,971 $53,510 $79,998 $— $440,479 
Operating income (loss)17,094 5,906 (4,744)(65,867)(47,611)
Adjusted EBITDA67,019 8,502 9,854 (42,533)*
* Non-GAAP financial measure not disclosed.